Steel prices on the minds of grain bin manufacturers

DENVER, COLORADO, U.S. — As several thousand members of the U.S. grain industry gathered in Denver March 25 for the first day of the Grain Elevator and Processing Society (GEAPS) Exchange, the decision by President Donald Trump to slap tariffs on imported steel was on the minds of many, particularly those companies that manufacture and sell large steel grain bins that dot the nation’s landscape.

Trump announced earlier this month that a 25% tariff would be imposed on imported steel and 10% on aluminum from selected countries, most notably China.

“The rise in steel tariffs is a big concern for pretty much everybody in this room,” said Matt Podany, sales manager, North America, for Chief Agri, from the GEAPS Exchange’s trade show floor. “We all manufacture stuff out of steel, and we have seen increases in the cost of steel recently. We’re not really sure how far it’s going to go, but the good news is we’ve positioned ourselves well to help keep our prices competitive.”

Jim McDonald, CEO of SCAFCO Grain Systems

Jim McDonald, CEO of SCAFCO Grain Systems, Spokane, Washington, U.S., said the companies that will be affected most by the tariffs are those that don’t buy from domestic steel manufacturers.

“We buy only domestic steel, so we are in good shape,” McDonald said. “The companies that buy foreign-made steel are probably sweating bullets right now, but the market overall I believe will stabilize. There will be some headwinds in the marketplace but eventually it will balance out.”

Another potential concern for the grain industry is Trump’s threat to withdraw from the North American Free Trade Agreement (NAFTA), which has been in effect between the United States, Mexico and Canada since 1994.

McDonald said he’s confident that the NAFTA agreement will remain in place between the three countries, but with different terms.

“I don’t see us withdrawing from NAFTA,” he said. “It’s been very beneficial for all three countries. I think the latest tariffs are a way to negotiate better terms with the NAFTA countries and I think was the main reason for doing it. My understanding is that Canada and Mexico have carveouts they’ve negotiated to avoid the tariffs, so it has worked. I think NAFTA will be in fine shape when all is said and done.”

New technology

The GEAPS Exchange, which runs March 25-27, began Sunday with the opening of the expo, which includes several hundred companies showcasing the latest technology in grain storage and handling.

Grain Systems, Inc. (GSI), Assumption, Illinois, U.S., was demonstrating to trade show attendees its new BinRite Grain Identification System, which is designed to prevent the accidental mixing of different grains and oilseeds.

The technology uses sensors that illuminate grain to analyze hundreds of images per second. The sensors can be integrated with an elevator’s existing programable logic controller protocols or have a stand-alone PLC. If the identified crop is being misrouted, the sensor system will stop grain flow and sound an alert.

GSI said the system will be available for the 2018 harvest season. It identifies corn, soybeans and white and red wheat.

“This is the first time we’re showing it anywhere,” said Adam Weis, director of global technology and product management for GSI. “In July we will begin selling it on the market.”

Any facility that handles more than one grain type deals with the problem of mixing grains, Weis said.

“At harvest, truckload after truckload of corn is coming in, and then one comes in with soybeans and someone forgets to change the distributor and they dump a load of beans on top of corn, and it’s an expensive mistake,” he said.

Chief Agri was at the trade show talking to customers about its new upgraded grain bin roofs, which feature a G140 galvanized coating.

“Our roofs now have a 56% thicker galvanized coating than the industry standard,” Podany said.

Several companies were showcasing their temporary storage solutions, which have been in high demand in recent years as the global grain supply outstrips demand.

The wall systems are assembled in 11 ½-foot long sections in 1 or 2 panel heights, said Kirk Nelson, international sales manager for Behlen. The pre-assembled panel are shipped in a leg-folded position to save on transportation costs and once on site the angle-iron supports are unfolded.

Nelson said a typical 100-foot by 300-foot single panel system can be set up in one day.

“We have put these up in 10 different states the last two years,” he said. “It is a low-cost alternative for storing grain. If you have grain overstock and it gets toward the end the harvest season, you can get these up fairly quickly and inexpensively.”

Rogers Foods recently invited World Grain to tour its expanded flour mill in Chilliwack, British Columbia, Canada. An article about the mill expansion and other recent company activities will appear in the April issue of World Grain.